NTAG and RrSG Oppose IPC/BC Requests for Additional New gTLD RPMs

ICANN’s most recently formed interest sector, the New TLD Applicants Group (NTAG), along with the longstanding Registrar’s Stakeholders Group (RrSG), have both issued statements taking strong issue with the appropriateness of considering proposals for enhanced and additional rights protection mechanisms (RPMs) at new gTLDs as well as their substance. Those proposals were unveiled by ICANN’s IP and Business Constituencies (IPC/BC) during ICANN’s recent Toronto meeting, and have been the subject of further development through multiple meetings of three separate working groups created by the IPC and BC over the past week.

New gTLD applicants have collectively invested $350 million in application fees to ICANN, and are understandably upset that issues sought to be settled and material to their business plans may now be reopened. As the October 24th NTAG statement relates:

Many of the BC & IPC proposed policy changes have been considered and rejected in no fewer than four different processes and numerous prior Board decisions. Indeed, many go far beyond the recommendations of the IRT, which was comprised almost exclusively of trademark attorneys. These last-minute policy recommendations amount to just another bite of the same apple that already has been bitten down to its core.

The new gTLD policy development process is over. Applicants relied on the policies in the final Guidebook in making business decisions on whether to apply. At the time that ICANN accepted applications and fees from applicants, ICANN and applicants entered into binding agreements. ICANN should not change these agreements unilaterally without extraordinary reason and especially not when it would materially harm the counterparties to the agreements.

There is no extraordinary reason here. The ICANN community spent more time and effort on RPM policy than any other issue related to the new gTLD program. The debate should not be reopened because an interest group wants to rehash substantive compromises and settled policy with new ICANN leadership. The rest of the community has not taken the same approach. Indeed, not only have applicants not tried to reopen the debate over RPMs, most have voluntarily agreed to additional RPMs that make sense for their strings.

The RrSG’s post-Toronto letter addresses several issues, with this said on the new RPM proposals:

We also understand various parties are advocating for the inclusion of additional Rights Protection Mechanisms (RPMs), in excess of what is currently in the Guidebook. We are extremely concerned about this development at such a late stage in the program.

The community spent years developing and building consensus for the current set of new RPMs for new gTLDs, and these will represent a significant increase to what currently exist in today’s gTLDs. Any effort to revisit the discussion of RPMs – particularly outside policy development processes meant to provide predictability to contracted parties should be done after the gTLD program (with its agreed-upon RPMs) has been implemented and the effectiveness of the new RPMs can be evaluated.

Additionally, we believe the additional RPMs circulated in Toronto represent a change to the policy and not the implementation of the TMCH. In our conversations with you, there was a clear distinction in your mind between the two and we would certainly agree with your assessment that policy and implementation be considered separately. The Policy Development Process exists to tackle community-wide issues by assembling a group of people from different stakeholder groups who can come together and work to resolve or lessen problems. Policy changes should not be pursued by a single interest group working directly with ICANN Staff. Doing so would in fact jeopardize, if not outright ignore, the significant implementation issues involved.

ICA has repeatedly expressed similar concerns and policy objectives, most recently with the adoption and publication of our “Domain Rights Dozen” principles for the review of new RPM proposals (see http://internetcommerce.org/Domain_Rights_Dozen). We see little reason to even engage in this debate at this time, and many of the proposals put on the table by the IPC and BC fail to pass the high standards we have set for acceptance.

Notwithstanding our qualms over both the timing and the substance of these proposals, as a member of the BC the ICA was faced with the issue of whether we would participate in any of the working groups fleshing out the proposal details. We concluded that it would be irresponsible to boycott them and instead opted to join the working group dealing with Uniform Rapid Suspension (URS) so that we could make the case for balanced and adequate rights on behalf of our members and other non-brand registrants.

We are pleased that the working group rejected WIPO’s call for an automatic complainant win and resulting domain suspension in those default cases where a registrant fails to file a response within fourteen days. The group instead recognized that even absent a response there must be some substantive review of the complainant’s allegations and other evidence to determine if all the elements required to satisfy the URS standard have been met by clear and convincing evidence.

On another hot issue, “loser pays” for registrants, the group did not reach consensus. The current URS model calls for the registrant to file a response fee if 15 or more domains are at issue in a single complainant filing. As the current policy targets serial cybersquatters, a middle ground of adding a requirement for response fees from registrants who had already lost 15 or more domains in URS actions was considered, but some group participants wanted to go much farther – to lowering the URS loss threshold to as low as two, to adding in UDRP losses, and with some participants wanting even registrants with a clean domain loss record to be required to pay a response fee to assert their rights. ICA will oppose any proposal that calls for any registrant who has less than 15 domains at issue from being subject to a mandatory response fee. Truly bad cybersquatting actors who file false WHOIS data and abuse the registration process in other ways will never respond to a URS complaint or pay a fee, while setting a low threshold for mandatory fees will just deter many innocent registrants from asserting their rights, especially as it piles an additional cost on top of any legal advice sought.

As to when and by whom these proposals will be discussed, that is becoming a question in itself. After initially considering a meeting today and tomorrow and London, ICANN CEO Fadi Chehade has invited a select group to meet with him in Brussels this Thursday and Friday. While we admire the hands on approach to tackling issues being demonstrated by ICANN’s new CEO, we are concerned that this overall procedure departs radically from established ICANN policymaking procedure, as well as that the failure to make any public announcement of the Brussels meeting, much less explain its purpose and how it meshes with ICANN’s new gTLD implementation and policy processes, is at odds with ICANN’s commitment to transparency and leaves much of the community in the dark.

ICA will continue to monitor and engage in this debate with the overriding aim of establishing and preserving substantive and due process rights for registrants that are properly balanced against trademark rights.

The New gTLD Applicant Group (NTAG) writes in reply to the renewed requests from

the Business Constituency (BC) and Intellectual Property Constituency (IPC) for

additional Rights Protection Measures (RPMs) for new gTLDs. If the BC and IPC policy

requests are granted at this time, the applicant community’s reliance on the Applicant

Guidebook will have been misplaced and the delicate balance of interests underpinning

the new gTLD program will be upset.

RPMs are not a new issue, nor are the specific BC and IPC proposals. The ICANN

community has struggled with the issue for many years. After different — and numerous

— processes and negotiations, including the Implementation Recommendation Team

(IRT), the Special Trademarks Issues Working Team (STI), various draft guidebooks,

and the GAC-Board consultations, the ICANN Community and Board agreed, through a

bottom-up consensus based process, to a balanced policy of mandatory requirements for the protection of trademarks in the final Guidebook.

Many of the BC & IPC proposed policy changes have been considered and rejected in no fewer than four different processes and numerous prior Board decisions. Indeed, many go far beyond the recommendations of the IRT, which was comprised almost

into binding agreements. ICANN should not change these agreements unilaterally

without extraordinary reason and especially not when it would materially harm the

counterparties to the agreements.

There is no extraordinary reason here. The ICANN community spent more time and

effort on RPM policy than any other issue related to the new gTLD program. The debate

should not be reopened because an interest group wants to rehash substantive

compromises and settled policy with new ICANN leadership. The rest of the community

has not taken the same approach. Indeed, not only have applicants not tried to reopen the debate over RPMs, most have voluntarily agreed to additional RPMs that make sense for their strings.

Many of the proposed policy changes are far more intrusive into the businesses of

applicants than are voluntary RPMs, and thus would materially harm applicants in that

they would amount to changes in business processes and create costly burdens. Several of the proposals would harm consumers as well. The proposals would put new entrants in a competitive disadvantage with incumbent registries, as these new policies would not be required in existing gTLDs. As partners in the new gTLD program, ICANN should strive for new gTLDs to succeed and not shackle them with costly requirements that are unnecessary and not required by their competitors.

As the NTIA’s letter to ICANN dated 4 October, 2012 states, any new RPMs should be

applied equally to both new and existing gTLD registries. We agree with the NTIA’s

suggestion that any new RPMs should be explored “though community dialogue and

appropriate policy development processes in the coming year.”

The Policy Development Process (PDP) process is the only vehicle to appropriately

consider new RPMs. The PDP process would analyze such proposals for new RPMs and weigh the impacts on the parties, including consumers. Any subsequent Consensus

Policies would then be binding on all gTLD operators, not just new gTLD operators.

Last minute changes to the Guidebook just prior to launch would be highly objectionable.

We have no objection to finalization of implementation details, such as resolving the

costing issue of the URS, but the Guidebook is in final form and any untimely requests

for policy changes should be rejected. We understand that Fadi Chehade discussed these renewed policy change requests with representatives of the BC and IPC on 18 October 2012. We would welcome the same opportunity at his earliest convenience.

On behalf of the Executive Committee of the Registrar Stakeholder Group (RrSG), thank you for givin g us your time during a busy week in Toronto. We very much appreciated you explaining your priorities as you begin your work as CEO.

It was clear to the group that you are focused on achieving your initiatives and we are committed to working with you and ICANN staff in a collaborative manner. The members of the RrSG are a diverse group and many have been active in the ICANN community for over a decade. Your focus on implementation and ensuring successful rollout of new policy was a breath of fresh air for all.

This letter will provide perspective on your two highest priority objectives – the conclusion of the Registrar Accreditation (RAA) negotiations and the rollout of the Trademark Clearinghouse (TMCH). We also address the last-minute requests of the Business and Intellectual Property Constituencies for additional rights protection mechanisms in new gTLDs.

RAA

For the past year, members of the RrSG and ICANN staff have been in negotiations over terms of a new RAA, with substantive progress made on all items. We have held numerous teleconferences, face to face meetings, and consultations with law enforcement, and feel the most recent draft document provided by the RrSG team provides for a much improved RAA for all parties and stakeholders.

As an example of progress, the RrSG (after clarifying consultations with law enforcement) has accepted nearly all (11 ½ of 12) requests made by authorities, including the complicated issues of enhanced data retention and Whois contact validation. As you’re aware, an unresolved issue is a process by which a registrar can fulfill its obligations when RAA terms conflict with national law.

The negotiating team has worked hard to gain members’ acceptance of these new requirements, amid strong internal disagreement, and a belief that material changes to the registration process must be subject to the defined policy development process. Accordingly, we believe both parties should accept the current RrSG draft as the best path forward and conclude negotiations with a set of terms that are reasonable and avoid negative or unintended consequences for registrars and their customers.

On that point, it’s important to express that inclusion of revocation language that allows ICANN to unilaterally “sunset” the full RAA is inappropriate for a commercial agreement, and there was broad-based opposition to the inclusion of this language both in Toronto and previously in Prague. We request its removal, in its entirety, prior to the groups re-engaging on substantive negotiations on the remaining outstanding issues.

We are all eager to conclude the new RAA and are hopeful your direct involvement in the discussions will expedite a positive outcome.

TMCH

One of the critical elements of the new gTLD program is the successful launch of the TMCH, so it was encouraging to see you actively involved in moving this forward during our time in Toronto.

RrSG members have been active in the development of the “Community” model currently being discussed, and we (majority of members) support the adoption of this model by ICANN and the TMCH provider. As registrars interact directly with consumers during domain registration, we have a vested interest in how the communication between the registries and the TMCH works. And because we have this relationship with our customers, registrars will provide end-user support for the TMCH system and program.

Additional RPMs

We also understand various parties are advocating for the inclusion of additional Rights Protection Mechanisms (RPMs), in excess of what is currently in the Guidebook. We are extremely concerned about this development at such a late stage in the program.

The community spent years developing and building consensus for the current set of new RPMs for new gTLDs, and these will represent a significant increase to what currently exist in today’s gTLDs. Any effort to revisit the discussion of RPMs – particularly outside policy development processes meant to provide predictability to contracted parties should be done after the gTLD program (with its agreed-upon RPMs) has been implemented and the effectiveness of the new RPMs can be evaluated.

Additionally, we believe the additional RPMs circulated in Toronto represent a change to the policy and not the implementation of the TMCH. In our conversations with you, there was a clear distinction in your mind between the two and we would certainly agree with your assessment that policy and implementation be considered separately. The Policy Development Process exists to tackle community-wide issues by assembling a group of people from different stakeholder groups who can come together and work to resolve or lessen problems. Policy changes should not be pursued by a single interest group working directly with ICANN Staff. Doing so would in fact jeopardize, if not outright ignore, the significant implementation issues involved.

Based on the RPMs in the Guidebook, registrars and registry operators have created product and business plans around those mechanisms, and to change those at this late date would have a significant impact on those plans. Moving forward with a change to the RPMs could further negatively impact reliance on the ICANN policy development process.

Again, we want to commend you for the way in which you have entered the ICANN community and your eagerness to move the organization forward. We stand ready to collaborate with you in these efforts.

Please do not hesitate to reach out to us at any time for our thoughts or perspectives.